Consultation Steering Group key messages 17 November 2016

Future of the tax and BAS profession consultation

Consultation on the Future of the tax and BAS profession is intended to be an ongoing stakeholder relationship group. It aims at gaining a joint understanding of the required capabilities and system required to support the tax profession over the next 2 to 5 years. It would refer specific matters for consultation to working groups which would report back to it. The need for an ongoing group was questioned and whether reporting could go straight back to the Tax Practitioners Stewardship Group.

Action item CSG 1611/1 - Future of the tax and BAS profession consultation group as an ongoing stakeholder relationship groupConsider whether there is a need for the stakeholder relationship group to be an ongoing stakeholder relationship group or if the Tax Practitioners Stewardship Group could fill this role.

A consultation paper on tax and corporate whistle blower protections is expected to be issued in December 2016 with feedback by February 2017.

Treasury noted that for diverted profits tax it is possible that limited consultation will occur before its introduction to Parliament.

Action item CSG 1611/2 – Timeframe for introduction of consolidation and Division 7A amendmentsTreasury to provide an out of session update on the timeframe for introducing the legislation.

Board of Taxation update

The Board continues to issue a newsletter after Board meetings.

The Board has received mixed messages on areas of concern within the tax system. For example only nine out of 40 organisations responded on the topic of inconsistent definitions in state and federal tax laws.

The Board noted a low level of engagement generally with the Sounding Board. The level of engagement with an issue will help decide its priority. The numbers of respondents is not the only factor but is relevant. Board is considering creating a new category for items that have not received much support after six months. The Board needs ideas by February to enable them to be included in a Regulatory reform bill that would be introduced in August.

Action item 1611/3 - Push notification service from the Sounding BoardInvestigate whether a push notification service is available from the Sounding Board.

Report on ATO consultation activity

Overview

Report provided an update on consultation activities between August to October 2016 including Stewardship group meetings, new matters raised and closed, changes to special purpose and stakeholder relationship groups. A number of suggestions received from ATO officers regarding improvements to the consultation process that could be put in place. Most of the learnings apply to the ATO.

Consultation paper has been issued on substantiation exceptions for reasonable travel allowances with comments due by 22 November 2016. A revision of the travel allowances ruling is planned to be published by June 2017.

A taxpayer alert was issued in April 2016 highlighting areas of concern. It is a complex matter involving withholding taxes, transfer pricing and permanent establishment attribution issues. Revised guidance expected to be released soon with planned consultations to include industry associations.

Collaboration continues between ATO and Treasury on policy and design with consultations being undertaken with those affected by reporting standards, using the ATO’s Let’s Talk website and the Software Industry Partnership Office. The design of strategic communications, including an awareness campaign and an issues register are a priority.

The community is seeking further guidance as services are now delivered with a more direct client focus approach. We have been consulting with leading associations and the Department of Health. Draft fact sheets to be published in December 2016 for comments by February 2017.

Consultation to date has provided insights on areas to prioritise such as database search ability and speed. An interim solution for improved search implemented in October 2016 with planned improvements by February/March 2017. Consultation worked well and has been finalised.

The consultation date of completion has been extended to enable consideration of:

links to other business initiatives such as the justified trust, reportable tax position, corporate tax governance issues

changed thoughts on dealing with the annual compliance arrangements.

Potential new ways to consult

Currently using ATO’s Let’s Talk, telepresence rooms and WebEx for webinars. Suggestions included:

new tools such as Skype for Business as more organisations adopt Microsoft Office 365 package

exploring new consultation tools used in other authorities, eg HM Revenue & Customs.

CSG action items

It was agreed to close the following action items:

CSG 1605/6 – Franking Dividend Declarations – suggestion to include an example on the ATO website on how the franking dividends account would need to be declared next year.

CSG 1608/1 – Consultations on taxpayer alerts.

Other business

Review of the Consultation Steering Group (CSG)

We will be seeking feedback from CSG members on the operations and effectiveness of the Group to identify potential areas for improvement. Review to be undertaken before the next CSG meeting on 23 February 2017.

Action item 1611/4 – Review of Consultation Steering GroupThe ATO will seek feedback from CSG members on the operations and effectiveness of the Group.

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